This study examines nuanced interplay between populist governance, ideological orientation and sectoral characteristics in shaping foreign direct investment (FDI) inflows in Latin America, a region where left wing, centrist and right wing populist presidents have frequently challenged established institutions but adopted divergent approaches to FDI across sectors. Using time series cross-sectional data from 18 Latin American countries between 2003 and 2021, this study found that populist tendencies under left wing presidents were associated with significant decreases of FDI inflows, a pattern not observed under centrist or right wing populist presidents. At the sectoral level, left wing populist tendencies deterred FDI in manufacturing and resource sectors, while infrastructure-related FDI remained largely unaffected. In contrast, centrist and right wing populist tendencies were positively associated with FDI inflows across all sectors. These findings underscore populism as a source of institutional volatility and potential deterrent to FDI. They also highlight the critical role of ideology and sectoral characteristics in influencing the populism–FDI nexus across Latin America.
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